setting up your own business (gym) from scratch

alienhead

i think this is the best forum for this, anyway.....

i've always wanted to try this, and, seeing as i've feck all experience with how to go about it......... here i am with a couple of questions

now remember, this is all pie in the sky at the mo......

1. location, premesis..... i'd really like somewhere in the city centre, dublin 2 would be nice. had a quick look on daft, at comercial properties, rents are kinda what i figured, 2,500 sq. feet, on one floor should be enough? about €2500 a month.

thing is, would it need a special zoning for a "gym"? also, what if the place is kitted out as a shop, office etc... are you aloud to just gut the place?

2. does the government give you any grants? if so, what do you get?

3. business plans, banks....... how do you come up with a business plan?, i take it you need this before you ask the bank for money.

4. has anyone on here started their own business, as in a comercial property, and been successfull, and would also be interested to hear from people who've tried but haven't been successfull.

basicly, would like to know how to go about this, step by step.

Eoin

Hi there, there's a business management forum as well, which is pretty good for these kinds of questions (not as much traffic as here though).

bookiebasher

be very careful starting your own business...everything looks good from the outside but you need to plan for everything that will crop up in business..
number 1 advice is if you dont have money behind you forget it..

alienhead

bookiebasher wrote:

be very careful starting your own business...everything looks good from the outside but you need to plan for everything that will crop up in business..
number 1 advice is if you dont have money behind you forget it..

i hear ye, i'd guess, 50k a year for decent premesis.

another 30k+ for equipment, then another 60k or so for wages, plus another 20k for bill etc....

am i missing anything?

so, 160k or so, does this sound about right?

Eoin

alienhead wrote:

i hear ye, i'd guess, 50k a year for decent premesis.

another 30k+ for equipment, then another 60k or so for wages, plus another 20k for bill etc....

am i missing anything?

so, 160k or so, does this sound about right?

Only 30K for equipment - do you mean the actual gym equipment?

Even basic gyms like Trinity (the one open to the public over the summer) will have 5 rowing machines, 15 treadmills, 3 or more steppers, striders and 10 cycling machines. I'd be very surprised if they came in anywhere near €1000 a piece. This is even before the weights machines etc.

What about showers, changing rooms and all that?

How many people would you get for 60K per year? I'm guessing you would need at least 2 instuctors - maybe one of these could double up and work in the reception, but I'd say that would be spreading yourself thin.

stepbar

alienhead wrote:

i think this is the best forum for this, anyway.....

i've always wanted to try this, and, seeing as i've feck all experience with how to go about it......... here i am with a couple of questions

now remember, this is all pie in the sky at the mo......

1. location, premesis..... i'd really like somewhere in the city centre, dublin 2 would be nice. had a quick look on daft, at comercial properties, rents are kinda what i figured, 2,500 sq. feet, on one floor should be enough? about €2500 a month.

thing is, would it need a special zoning for a "gym"? also, what if the place is kitted out as a shop, office etc... are you aloud to just gut the place?

It might be, this is where market research comes in. What facilities do the other gyms in D2 have? What do you propose to do that is better?

2. does the government give you any grants? if so, what do you get?

Not so sure, but I would imagine not too much

3. business plans, banks....... how do you come up with a business plan?, i take it you need this before you ask the bank for money.

You might need planning permission (i.e permission for change of use)

I would suggest that you get round to as many gyms as possible and see what they have. You would need to pitch your offering at a certain market. e.g you couldnt expect to charge the same price as Jackie Skelly - most of their gyms have a pool and jacuzzi. Unfortunately its all about location in this game and that aint going to come cheap.

Lets say you decide that 150k would be enough to get you started. 150k @ 6.15% for 10yrs would work out at €1326.88 pm. Lets say you peg your membership at 500eur per year, you would need approx 32 paid memberships to pay back the loan repayments. So in year 1 that is all you would need to do is cover your loan repayments and break even. However in Year 2 you would have to significantly increase your membership to cover the cost of staff, rent, light and heat, insurance, advertising, depreciation of equipment. You may need to turnover 150k to even break even. Therefore 300 members would be needed and so on.

You would definatly need a business plan before you start. A business plan basically is a blueprint (like the maps of a house). Good business plans would usually have the following

an detailed outline of the proposition or proposal (what do you want to do and why)

A section on how do you plan to get from a to b? (Raise capital from where?, a marketing plan including what research you have done, advertising etc)

a 3 year cash flow (or some sort of income / expenditure estimate) projection

If you dont have that as a minimum a bank wont even look at you; its very hard to judge risk when you dont have a business plan.

Found this on the social welfare website http://www.welfare.ie/publications/toiltrouble.pdf
It may help.

nesf

Do you have any previous experience as a gym instructor or as a manager? Would you be able to put up much cash yourself or would it mainly be financed by loans?

Regarding business plans, I've never been involved with one involving commercial property or a 'retail' scenario so I can't advise you on that side, but what I can tell you is that doing your research properly is very important. If you put forward a business plan that isn't properly researched you will have closed the door before you've even set foot inside. Be prepared to put in a good few hours researching every aspect of what you hope to do.

That said, if you haven't had much experience working in the industry and you are not putting up much of the financing yourself then I'd say your chances are relatively slim tbh.

alienhead

thanks for the replies... as i said this is all pie in the sky at the mo, very helpfull advice though.

i agree with the low estimate for staff eoin_s, but as far as equipment goes, i'm pretty sure this can be leased.

i'd say majority of the money would have to be borrowed, or possibly from investors?

stepbar

alienhead wrote:

thanks for the replies... as i said this is all pie in the sky at the mo, very helpfull advice though.

i agree with the low estimate for staff eoin_s, but as far as equipment goes, i'm pretty sure this can be leased.

i'd say majority of the money would have to be borrowed, or possibly from investors?

If you could at all, you should restrict it to family and friends. That way you know what you are dealing with. Kicking in money yourself shows commitment to the business. In fact you will have to if this is your first. Obviously the more you can raise yourself, the better the chance you will get the loan you are after.